An attempt by Optus to break Telstra's claimed 75 percent hold on the lucrative enterprise and government market has been slammed by the incumbent telco as "extraordinary".
The issue has simmered for several months since Optus and Macquarie Telecom raised it in August submissions to the ACCC's fixed services review, and has now drawn a response — and the ire — of Telstra.
Optus warned in August it faced being marginalised in the corporate and government market, which it defines as having at least 200 seats and being "particularly sensitive to the availability of access to Telstra telecommunications infrastructure".
Corporates and agencies typically wanted to buy services on a "whole of business" basis, but only Telstra had the ubiquitous infrastructure to meet this need, Optus argued.
"The difficulty to compete is shown by Telstra's 75 percent market share in the corporate market," Optus said in August (pdf).
"Corporate customers may require supply to multiple premises and an entire corporate account may be lost if even one such location is inaccessible."
Optus is asking the ACCC to make changes to the way wholesale line rental (WLR) and local carriage services (LCS) are regulated.
In particular, it wants present exemptions for regulations in CBD areas to be scrapped to improve the chances of service providers other than Telstra winning corporate and government accounts.
But the rollback of CBD exemptions has been cut down by Telstra, which argues there is no competition bottleneck in CBD areas, evidenced by Optus' recent $530 million renewal of a telecommunications supply deal with banking giant ANZ.
"This [deal] suggests that the current CBD exemptions are not adversely impacting competition in the enterprise and government market segment," Telstra argued in a regulatory filing published over the weekend. (pdf)
Telstra said an absence of WLR and LCS regulation in CBD areas "has not in any way impeded the development of competition, which has benefitted all end users in the CBD exchange service areas".
"It would be an extraordinary decision for the Commission to now decide to remove LCS exemptions that have stood for 10 years, and implement WLR regulation in CBD areas where this has never existed," Telstra said.
The ACCC did not specifically ask industry to consider the impact of revoking CBD exemptions for WLR and LCS services as part of the fixed services review announced in July. It canvassed the two wholesale services only in general terms.
Several telcos have provided submissions around the impact of current WLR and LCS regulations in CBD areas, but the evidence is redacted and claimed as commercial in-confidence.
This could backfire on those seeking change, as the ACCC has raised the prospect of negatively weighting its consideration of information that is kept from other industry participants as part of this and other future reviews.